Nigeria: Transport Policy to the Rescue


Eromosele Abiodun writes that the draft National Maritime Transport Policy will transform the industry.

Maritime transport is essential for sustainable trade and development. It is a central part of the “Blue Economy”, which has enormous potential to promote economic growth and improve peoples’ lives – while addressing many of the United Nations Sustainable Development Goals.

Maritime transport is essential to the proper operation of any country’s economy and a vital part of a nation’s transport infrastructure.

As a matter of fact, without maritime transport, Nigeria would have been landlocked and its economy will not move forward but remain stagnant in different areas and as such maritime transport is of significant importance to and greatly influences the development and growth of the Nigerian economy in several ways.

Maritime transport is of significant importance to the Nigerian economy because it generates a lot of revenue for the federal and state governments which revenue is channeled towards the development of maritime infrastructure and the other areas including health and education.

The revenue comes from fees for the registration of ships and their mortgages, Customs duties, port charges and tariffs realised by the Nigerian Ports Authority (NPA) for the use of its facilities by the vessels that berth at Nigerian ports, corporate taxes paid by shipping companies, fees for licensing clearing and forwarding agents or freight forwarders and the registration of shipping companies.

The Nigeria Maritime Administration and Safety Agency (NIMASA) collects three per cent statutory charge on gross earnings of shipping companies on imports and exports, whilst all payments for services offered and rendered to foreign vessels at Nigerian ports are payable in foreign currency.

However, because of the lack of policy guiding activities in the sector, Nigeria and many countries are not able to take advantage of the potential of the industry.

Transport policies are standards, principles, and rules formulated or adopted by the government to accomplish its long-term goals of efficient public transport system. The public transport policies also serve as regulatory framework, which guides all activities in the sector. The need to develop a national transport policy that is responsible to the needs of the country and its people is essential in developing countries like Nigeria. A transport policy therefore provides the guidelines for planning, development, co-ordination, management, supervision and regulation of the transport sector with its fundamental goal of developing an adequate, safe, environmentally sound, efficient and affordable integrated transport system within the framework of a progressive and competitive market economy.

This will involve public private partnership (PPP) in public transport sector projects with goals of economic, social and environmental growth. Also, there is need for ports and inland waterways development, management and reforms.

Rarity of Policy

Nigeria is currently ranked 127th among 144 nations of the world in global competitiveness of their transport systems. According to experts, government policies have dependably been exceptionally rare and where and when they exist, two noteworthy issues would negatively impact them which are policy somersault as a result of changing government/administrators and the lack of articulation of these policies with virtually all the agencies charged with implementing the policy doing things haphazardly with several policies coming from different agencies on the same issue due to lack of coordination. Transport policy, experts admonished, should be developed to give a satisfactory, moderate, safe, environmentally sound and efficient transport system with regards to a dynamic and aggressive market economy.

To accomplish the goals of such policy, a specific institutional framework, which incorporates the Federal Ministry of Transport with its varieties of offices and parastatals with comparative must be set up at the state levels and local government levels.

Recognising the need for a policy as a guiding principle in the industry, the federal government brought stakeholders to deliberate on a draft National Maritime Transport Policy before a final document is released.

Speaking at the event, the Minister of State for Transportation, Senator Gbemisola Saraki, said the National Maritime Transport Policy being developed by Nigeria would lead to improved Foreign Direct Investment (FDI) inflow and enhance the ability of the Nigerian maritime sector to compete internationally.

The minister’s address was delivered by Permanent Secretary, Federal Ministry of Transportation, Dr. Magdalene Ajani.

Saraki said the transport policy would give Nigeria pride of place in the African Continental Free Trade Area (AfCFTA) agreement. The free trade area, the world’s largest, was founded in 2018, and came into effect from January 1, 2021.

The meeting was organised by the Federal Ministry of Transportation to get stakeholders’ buy-in and input, as the policy document was being fine-tuned. The transport policy is expected to usher in a regime of robust maritime transport system in the country in line with international best practice.

She underscored the strategic economic importance of maritime transportation, saying adoption of the transport policy would mark a paradigm shift in Nigeria’s economic competitiveness.

Guiding framework

According to her, “The National Maritime Transport Policy is a framework that will guide and sharpen the activities, actors and modus operandi in the maritime sector. It is an all-encompassing document that will skyrocket the sector to compete favourably in the global market. That is why this document is extremely important and crucial to the development of the sector.”

She said the National Maritime Transport Policy, which industry stakeholders had clamoured for since nearly two decades, “Will change the narrative in the maritime sector of our dear country and result in a paradigm shift that is generational.”

Saraki added: “It is encouraging to know that the maritime policy is coming up at a time when Nigeria has ratified the AfCTA Agreement and deposited it with the AU Secretariat. This is an agreement that will place Nigeria in place of leadership if we adequately prepare for the protocols.

“Therefore, it is expedient for us to make the maritime sector ready for the AfCFTA Transit Protocols and other international protocols for us to compete favourably in the regional and global market.”

Nigeria deposited its instrument of ratification of the AfCFTA agreement on December 5, 2020, becoming the 34th member state to formally ratify the treaty. The free trade area was created by the African Continental Free Trade Agreement among 54 of the African Union (AU) 55 member states.

It is the world’s largest free trade area since the World Trade Organisation, and a game-changer in African and world trade, with a market of more than 1.2 billion people, about $3 trillion combined gross domestic products (GDP), and the potential of growing intra-African trade by over 50 per cent, according to the United Nations Economic Commission for Africa.

Bedrock of development

In her own speech, the permanent secretary said policy was the bedrock of development and the condition of the maritime sector of a nation determined its future development.

Ajani said: “Nigeria, like other nations, has recognised the integral role policies play in developmental process and, as such, engendered different processes to drive her quest for a sustainable, feasible and generic National Maritime Transport Policy. This will boost the maritime sector and widen the horizon to enable it serve the domestic market and have comparative advantage globally.”

On his part, Chairman of the Technical Committee, National Maritime Transport Policy, Dr. Paul Adalikwu, revealed that the move by the International Maritime Organisation (IMO) to carry out an audit exercise of the Nigerian maritime sub-sector prompted the government of Nigeria to revamp the document that has been on the shelf at the Federal Ministry of Transport for over twenty years.

In a summary of the report of the inter-ministerial Committee on the Development of a National Maritime Transport Policy, Adalikwu said that though the process of producing a sustainable policy document is currently on going, the Federal Executive Council (FEC), has considered the document and referred it to a Ministerial Committee for review.

Akalikwu disclosed that the IMO Member State Audit Scheme (IMSAS), Committee was scheduled to visit Nigeria to conduct an audit exercise of the nation’s maritime sector and aware of the absence of a policy document, the Ministry of transport quickly set up a Committee to develop the National Maritime Transport Policy, to meet with the visiting Audit Committee’s requirement.

This, according to Adalikwu, was the genesis of the effort to formulate a NMTP, a development that led to the constitution of the Technical Committee and work done during the visit of the IMO team.